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Rapid transformation awaits technology channel in 2016

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Against a backdrop of structural change and technological progress, the technology infrastructure channel is about to go through a period of rapid transformation. Philippe Fosse, vice-president: EMEA channels for EMC, gives his predictions for just what 2016 has in store for channel players and how they can look to drive growth.
In 2015 we saw the full impact that cloud is having on businesses. Enabled by the flexibility and power of cloud computing, companies have launched new digital business models that are transforming customer services. At the same time, wholly new businesses have gained currency, ones like Uber and Tinder, which are reshaping entire industries and even cultures.
Against this backdrop, the channel is evolving. In order to better meet customer requirements for flexibility and scalability, the IT channel is becoming increasingly flexible and scalable itself. It is fair to say that the channel of today bares little or no resemblance to the channel of just two or three years ago.
With the competencies of resellers, managed service providers and outsourcers merging, in a few years’ time such distinctions will hold little meaning. Instead we will simply have “partners” – segmentation will be replaced by partners that can flex to deliver different selling motions as required.
I think that 2016 will see this pace of change accelerate further as we continue to move towards a brand new age of powerful enterprise IT. This will be characterised in the following ways:
* Channel co-opetition will become more widespread
* There will be a war for talent
* We will see high-growth in flash, software-defined, and hyper-converged infrastructures
* Distributors will continue to evolve
* 2016 will be the first big year of the Internet of Things
Overall, the year ahead promises much opportunity for channel businesses, but only in so far as they can embrace the change required to thrive in the modern business environment.

Co-opetition will become more widespread
The advent of cloud computing and virtualisation has made the IT infrastructure channel much more complex than it used to be. With a wide array of technologies and business models available to partners and customers alike, it is no longer possible for one partner to meet the needs of all its potential customers.
A partner might, for example, be great at offering on-premise infrastructure, but less so as delivering cloud-based managed services. As a result, in 2016 we will see an increase in instances of so-called ‘co-opetition’ within the channel.
Partners will look to service any and all customer requirements, using their own skills where possible, but sub-contracting to competitors when necessary. In today’s landscape, if a reseller cannot offer off-premise capabilities they must partner with a business that can, even if that business is usually a competitor.
This evolution places the customer even more firmly at the centre of the process. All that matters in the new channel ecosystem is the customer’s need – the partner will look to deliver on this in any way possible, using whichever technology approach is best suited to each specific use case.
In the light of this change, channel businesses will need to become more customer-savvy. They must get under the skin of the customer like never before, understanding not only their business models inside out, but also their internal procurement dynamics. Knowing who the decision makers are is key; as is understanding the biases they might have towards given technologies. Overcoming these biases is, after all, essential in delivering a solution that best addresses the customer’s business challenge.

There will be a war for talent in the IT partner ecosystem
As the pace of hybrid cloud deployments accelerates, and cloud technologies continue to mature, it will become increasingly important for channel organisations to have the right sales talent in place.
The channel sales agent of 2016 will not only need to understand the customer’s application, but also the infrastructure that serves it. This knowledge will include understanding where best to run a workload – on-premise or in the public cloud – as well as of the key platform technologies essential for hybrid infrastructures: Platform as a Service (PaaS), Infrastructures as a Service (IaaS). It will also require agents to know how Cloud Native Applications (CNA) are built.
These are technologies that sales agents will need to understand fully and be able to provide expert consulting around. This is a step change in skills that will require serious planning on the part of resellers to accommodate.
Security will, of course, continue to be an important element of the IT mix in 2016 as businesses seek to protect themselves from rising levels of cybercrime. Sales staff targeting the hybrid cloud market will, therefore, also need to be security experts, able to advise their customers on how to ensure their hybrid infrastructures are secure as well as effective. This means sales staff will need a broad and deep array of technology knowledge spanning the entire cloud space – no mean feat to achieve.
Channel organisations will therefore be on the lookout for the very best people on offer; setting in motion something of a talent war as resellers look to quickly build their cloud-savvy sales teams.
Talent management will also be a priority for any channel business. This includes putting in place robust training programmes to give sales agents the skills they need to capitalise on the hybrid cloud opportunity. It will also involve creating company cultures and working practices that keep sales agents engaged and well rewarded, to ensure they do not go looking for work elsewhere.

2016 will see high-growth in flash, software-defined, and hyper-converged infrastructures
In 2015 we saw hybrid cloud emerge as the preferred model for cloud deployments. In 2016 this trend will continue; driving growth in three key technology areas: flash arrays, software-defined infrastructures and hyper-converged infrastructures.
All-flash arrays are already becoming the de facto storage medium for the age of the cloud and we will see penetration of flash continue to gain pace in the year ahead.
Over the past year hybrid cloud has been responsible for the growth of converged infrastructures and reference architectures. This growth will continue in 2016 as businesses look to manage complexity within cloud environments.
I also predict that 2016 will see the nascent hyper-converged infrastructure segment grow as new channel players seek to exploit the opportunities on offer to serve middleware and mid-sized applications. The hyper-converged market will be entirely focused on the channel, targeting mainly mid-sized businesses, and promises and important new stream of revenue for resellers.
Finally, software-defined infrastructures will continue to be a strong source of sales for the channel. It is now clear that the future of enterprise IT lies in the complete virtualisation of infrastructure. Any channel player serious about making it in 2016 will therefore have software-defined propositions on their sales catalogues.

Distributors continue to evolve
Change has been rapid and widespread in the channel of late. Perhaps most of all, the distribution channel has been subject to transformation in the wake of the cloud revolution.
Today, distributors are as likely to aggregate cloud services and connect resellers to them as they are to shift hardware, a change that will prove vital to their survival and success over the next few years. Bundling cloud services from various vendors and delivering them to resellers will also prove invaluable, as resellers seek to offer customers any and all solutions to their infrastructure requirements.
In 2016, I also expect to see an increasing number of distributors aggregate and connect private cloud services, taking on the role from vendors. This will allow IT vendors to focus on product innovation while distributors can focus on delivering effective hybrid cloud environments to their customers.

2016 will be the first big year of the Internet of Things
Gartner has predicted that 2016 will see the Internet of Things hit the big time, with a mesh of ‘smart’ machines and digital devices and services glued together by a data backbone. It is a vision whereby nearly everything is a device and everything is capable of generating the data that could lead to business-changing insight.
For the channel, a major opportunity will emerge at the cross roads of data and analysis. This is especially true of large systems integrators that have already developed their own big data storage and analysis capabilities. Such organisations are in the perfect position to explain to customers both the underlying infrastructure needed for success and the benefits that are derived from them.
Eventually, as a result of the Internet of Things, all businesses will be big data businesses. In 2016, channel organisations can stake a claim in helping businesses migrate to this new data-driven world.